Parsing the Bitrate. Robots for trading cryptocurrency. Automated trading in 2021?
Robots for stock trading
Robots for trading on the stock exchange are add-on programs that connect to the API of trading terminals. They perform various tasks: collect information about the current state of the market and place buy and sell orders according to the parameters and algorithms set by the trader.
Based on the collected data on the volume, dynamics and capitalization of the market, robots for trading cryptocurrency make certain decisions that are provided for by the trader’s strategy. The development of artificial intelligence and neural networks has led to the fact that now bots are moving away from the role of simple add-ons and become more complex programs that are capable of independent decision-making and analysis of the situation.
Robots for trading on the cryptocurrency exchange
Robots for trading crypto currency, like their traditional counterparts, work on the basis of data collected from different platforms. Bots are mainly used for day trading, swing trading, and scalping, since this strategy generates most of the profits in markets with high volatility.
How do I write my own robot? Many people ask this question, but the answer is not as simple as it seems. Creating a trading robot is a challenge for experienced traders and programmers who can develop an algorithm for collecting and analyzing large amounts of financial data. Many bots for cryptocurrency exchanges are available in open sources:
For example, the Bitrate system is fully automated for the investor, his bots are accompanied by the best traders. But on 3Commas, you need to do the configuration manually, which is not everyone can do.Strategies for bots: trading on the stock exchange
The advantage of trading bots is their versatility: they can be programmed to execute any strategy, the most popular of which are trading on the stock exchange (intraday, swing and scalping), arbitrage and market-making.
Trading on the stock exchange
The most popular strategy is trading on the stock exchange; in this case, the robot sells and buys assets depending on the programmed conditions. As a rule, robots are used for intraday trading, scalping and swing trading.
At the dawn of the development of cryptocurrency markets, the arbitrage strategy was popular — that is, buying an asset on one exchange and reselling it on another. The profit was considerable due to the difference in prices on the platforms. Today, arbitrage bots track price discrepancies on different exchanges and give the trader the opportunity to make money on the price difference.
Market-making allows you to create liquidity in the glass by placing and deleting orders. This is necessary in order to maintain price quotes at the level of other markets and give other participants the opportunity to easily sell or buy assets at the current price. Market-making bots analyze data from different platforms and automatically place orders in a certain range.Bots for trading on the cryptocurrency exchange
Creating your own robot is not easy: to do this, you need to have a lot of experience not only in programming, but also in trading. However, in open sources on the web, you can find a bot for each strategy. Just as I mentioned earlier, there are bots that are accompanied by traders themselves, and the investor himself does not need to delve into their work and configuration, which is an excellent solution for beginners. When choosing a robot for trading, you need to consider several factors:
- ease of use;
- software features.
The best bots for cryptocurrency trading in 2021
There are many different bots for trading cryptocurrency, but the most popular at the moment — CryptoHopper, Bitrate, Gekko. Each robot has certain functions and features that distinguish it from its competitors.
Let’s analyze how the trading itself takes place, using the example of Bitrate
- the bot exchanges data with the exchange via a secure communication channel;
- retrieves currency data;
- makes a forecast of rising / falling prices;
- depending on the forecast, it makes a profit calculation;
- makes a deal or makes the next miscalculation in case of unprofitability of the previous one;
The main advantage of cryptocurrency trading bots is that they work 24/7. This allows you to extract more profit. Since the crypto market does not have a standard working session and is available constantly during the day.
Simply put, trading bots mainly use various variations of scalping. By making hundreds of trades a day, you can achieve a good margin.